Many people now hold gold in their hands, but their hearts are uneasy: Will this thing suddenly turn hostile? Will they be stuck with it for thirty years once they get caught in it?

Actually, there's no need to worry. Look back at the financial ledger of the past forty years, every sharp decline in precious metals is not a black swan appearing out of nowhere — there are clear and visible reasons behind each one.

**First Wave of Crash: 1980 to 1982, an 85% plunge**

What caused it? The Federal Reserve forcefully raised interest rates to the sky. At that time, as long as you deposited money in the bank, you could earn interest passively. Who would hold onto non-yielding gold and wait? The result of capital voting with its feet was a collective sell-off of precious metals. This is routine operation, nothing extraordinary.

**Second Wave of Rapid Decline: 2008 financial crisis from March to October, a 30% drop**

Don’t misunderstand — it’s not that gold itself had a problem, but that the entire global financial system was running a fever. Global cash flow dried up to the limit, and institutions had to sell everything they could to survive — including gold — just to get some emergency cash. This is called a "liquidity storm," unrelated to whether the asset itself is valuable.

**Third Wave of Forgetfulness: 2013 to 2015, a cumulative 39% decline**

What attracted the most money back then? The real estate and stock markets. When the market found more lucrative yields elsewhere, defensive assets naturally became less attractive. This is the inherent pursuit of profit in capital, nothing mysterious about it.

**Fourth Wave of Testing: Second half of 2016, a 16% decline**

Simple and straightforward logic: the Federal Reserve was about to raise interest rates. Smart money ran away early, and the market used the decline to digest this negative news.

**Pattern Recognition**

See the pattern? The script of major drops in precious metals repeatedly features three main actors:
- The first: The Federal Reserve wielding the interest rate hike baton
- The second: The market suddenly finding higher-yield favorites (high-yield assets, emerging sectors, etc.)
- The third: Capital flowing into new reservoirs (like the crazy real estate boom back then)

History is cyclical, human nature hasn’t changed. The biggest risk in precious metals investment isn’t the market cycle itself, but people’s tendency to go all-in irrationally when emotions run high.

By understanding these cyclical laws, precious metals can become the ballast in your asset allocation; if you can’t see through cycles and human nature, any seemingly safe asset can trap you tightly.